Is it Covered? Do You Have Enough?

When was the last time you reviewed your homeowner’s insurance policy?

Many people hardly give their policies a second thought until the need arises. This can lead to misunderstandings about what’s covered and what percentage of the value is covered. 

Questions to ask your insurance company: 

Does my homeowner’s insurance cover natural disasters and what kind? 

It depends. Standard coverage does include wind damage, including that from hurricanes and tornadoes, said the Insurance Information Institute. However, they don’t typically cover flooding, including water damage from a hurricane, so read your policy carefully to learn its limits. Standard policies cover fires, including wildfires, as well as hail and lightning strikes, but typically not earthquakes. Beyond the actual dwelling, homeowners policies also usually cover detached structures such as a garage or gazebo.

Do I need an umbrella policy? 

Perhaps. Umbrella policies provide additional liability protection beyond the monetary limits on your standard auto or homeowner coverage. This can be helpful if you cause a major accident and are subject to a large legal judgment. Do I have enough insurance for my home and personal property? 

Roughly two in three U.S. homes are underinsured by 25% or more, said Fiske, citing a study by Marshall & Swift/Boeckh. Some homeowners haven’t updated their coverage to reflect remodeling or other improvements. Others don’t recognize how high construction costs can be.

Find out the cost to rebuild your home and take inventory of your personal property and it’s approximate value. Then call your agent and update your insurance!